NIGERIA'S FOOD IMPORTATION BILL HITS 3 TRILLION NAIRA SAYS CENTRAL BANK OF NIGERIA

 

 TIME FOR NIGERIA TO REVERT TO 2011 AGRICULTURAL TRANSFORMATION AGENDA TO SAVE OUR ALREADY COLLAPSING AGRICULTURAL SECTOR.

Transforming Nigeria's Agricultural Sector

Introduction

Nigeria, with its vast arable land and favorable climate, has immense potential to be a global agricultural powerhouse. However, despite these natural advantages, the sector faces numerous challenges that hinder its full potential. Addressing these challenges through strategic interventions can significantly transform Nigeria's agricultural sector, enhancing food security, creating jobs, and driving economic growth.

Key Challenges

Nigeria's agricultural sector is beset by several critical issues:

1. Limited Access to Finance: Many smallholder farmers lack the financial resources needed to invest in modern farming techniques and equipment.
2. Inadequate Infrastructure: Poor transportation and storage facilities lead to significant post-harvest losses.
3. Low Adoption of Technology: Traditional farming methods dominate, resulting in low productivity.
4. Policy Inconsistencies: Frequent changes in agricultural policies and lack of implementation hinder long-term planning.
5. Land Tenure Issues: Unclear land ownership rights discourage investment in agriculture.
6. Climate Change: Increasingly erratic weather patterns affect crop yields and livestock productivity.

Strategic Interventions

1. Improving Access to Finance

To transform agriculture, financial inclusion for farmers must be prioritized. Establishing agricultural banks with favorable loan terms and low-interest rates can provide the necessary capital for farmers to invest in better seeds, fertilizers, and equipment. Additionally, leveraging mobile banking and fintech solutions can facilitate easier access to financial services for rural farmers.

Microfinance and Cooperative Models: Promoting microfinance institutions and farmer cooperatives can help pool resources and provide farmers with the financial backing needed for their operations. Cooperatives can also negotiate better prices for inputs and outputs, improving profitability.

2. Enhancing Infrastructure

Rural Roads and Transportation: Investment in rural infrastructure, particularly roads, is crucial. Improved transportation networks will reduce post-harvest losses by ensuring timely delivery of produce to markets. The development of rail networks and inland waterways can further support this goal.

Storage Facilities: Building modern storage facilities such as silos and cold storage units can minimize post-harvest losses. Public-private partnerships can be instrumental in developing these facilities.

3. Promoting Technological Adoption

Extension Services: Strengthening agricultural extension services can bridge the knowledge gap by educating farmers on modern farming techniques. Utilizing information and communication technology (ICT) tools like mobile apps to disseminate information on best practices, weather forecasts, and market prices can enhance productivity.

Mechanization: Promoting the use of modern farming equipment through subsidies and training programs can significantly boost productivity. Small-scale mechanization solutions tailored to the needs of smallholder farmers should be prioritized.

4. Policy Stability and Support

Consistent Agricultural Policies: Establishing long-term, stable agricultural policies that are consistent across administrations can create a conducive environment for investment. Policies should focus on providing subsidies, ensuring price stability, and protecting local farmers from unfair competition.

Land Reforms: Implementing land reforms to secure land tenure and streamline land registration processes can encourage investment in agriculture. Clear land ownership rights will provide farmers with the security needed to invest in their land.

5. Climate-Resilient Practices

Sustainable Farming Techniques: Promoting sustainable agricultural practices such as crop rotation, agroforestry, and organic farming can enhance resilience to climate change. These practices improve soil health, conserve water, and increase biodiversity.

Research and Development: Investing in agricultural research to develop drought-resistant crop varieties and climate-adaptive farming techniques is essential. Collaboration with international research institutions can accelerate this process.

Leveraging Value Chains

Developing value chains for various agricultural products can ensure that farmers benefit from the entire production process. This involves:

Processing and Packaging: Establishing agro-processing industries will add value to raw agricultural products, create jobs, and increase farmers' incomes. Encouraging small and medium-sized enterprises (SMEs) in this sector can drive rural industrialization.

Market Access: Creating efficient market linkages through cooperatives and digital platforms can help farmers access better prices. Export promotion strategies for cash crops can open up international markets, boosting foreign exchange earnings.

Quality Standards: Implementing and enforcing quality standards for agricultural products can enhance their competitiveness in both local and international markets.

Human Capital Development

Education and Training: Providing agricultural education and vocational training can equip the youth with the skills needed for modern agriculture. Introducing agricultural courses in schools and universities will foster a new generation of educated farmers.

Youth and Women Empowerment: Encouraging youth and women to participate in agriculture through targeted programs and incentives can drive innovation and productivity. Access to land, credit, and training for these groups can significantly boost the sector.

Role of Technology

Digital Agriculture: Adopting digital technologies such as precision farming, drones, and satellite imagery can optimize resource use and increase yields. Mobile apps providing real-time information on weather, pest control, and market prices can empower farmers to make informed decisions.

Blockchain for Transparency: Utilizing blockchain technology can enhance transparency in the agricultural supply chain, ensuring fair prices and reducing corruption. It can also provide traceability for food products, which is crucial for meeting international standards.

Conclusion

Transforming Nigeria's agricultural sector requires a multifaceted approach that addresses financial, infrastructural, technological, policy, and educational challenges. By improving access to finance, enhancing infrastructure, promoting technology adoption, ensuring policy stability, and developing human capital, Nigeria can unlock the full potential of its agricultural sector. This transformation will not only ensure food security but also create jobs, reduce poverty, and drive sustainable economic growth. With concerted efforts from the government, private sector, and international partners, Nigeria can become a leading player in global agriculture.

The Central Bank of Nigeria released a total sum of $2.13bn to Nigerians for importing food products in 2023, Findings by The PUNCH have shown.

According to the quarterly statistics of the Central Bank of Nigeria, the forex release showed that there was consistent demand from foreign countries despite being touted as the food basket of Africa.

This came as the average price of imported food commodities to Nigeria rose to its highest level, reaching 34 per cent in one year between April 2023 and April 2024.

The rise in food prices in sub-Saharan Africa, is partly due to global factors, as the region imports most of its top staple foods.

The high food import bill is a concern for Nigeria’s economy. The country has a large agricultural sector, and there have been efforts to boost local production to reduce the dependence on food imports. However, factors such as inadequate infrastructure, insecurity, and climate change have hindered progress in the sector.

The Federal Government had also ruled out the importation of food as part of strategies to address the high costs of foodstuffs and the economic hardship troubling the country.

But the staggering sum, experts say, is a clear demonstration that the Nigerian government is yet to put the nation on the right path of eradicating hunger by 2030 as stipulated by the United Nations Sustainable Development Goals.

A breakdown for 2023 showed that $245.7m was disbursed for food import in January, $163.6m in February, $268.4m in March, $240.9m in April, $238.3m in May and $206.1m in June.

In July 2023, the apex bank disbursed $58m for food importation, $95.3m in August, $119.9m in September, $132.4m in October, $235.9m in November and $126.2m in December.

Comparatively, the figure was $644,000 or 23 per cent less than a $2.7bn disbursed by the apex bank for food importation.

In the April 2024 food inflation report, the NBS said the increase of 15.92 per cent to 40.53 per cent was caused by price surge of, “millet flour, garri, bread, wheat Flour prepacked, semolina (which are under bread and cereals class), yam tuber, water yam, cocoyam (under potatoes, yam and other tubers class), coconut oil, palm kernel oil, vegetable oil, etc (under oil and fat), dried fish sardine, catfish dried, mudfish dried (under fish class), beef head, beef feet, liver, frozen chicken (under meat class), mango, banana, grapefruit (under fruit class), Lipton tea, Bournvita, Milo (under coffee, tea and Cocoa Class).”

“On a month-on-month basis, the food inflation rate in April 2024 was 2.50 per cent which shows a 1.11 per cent decrease compared to the rate recorded in March 2024 (3.62 per cent).

The fall in food inflation on a month-on-month basis was caused by a fall in the rate of increase in the average prices of yam, water yam, Irish potatoes (under potatoes, yam & other tubers class), beer, local beer (under tobacco class), Milo, Bournvita, Nescafe (under coffee, tea, and Coco Class), groundnut oil, palm oil (under oil and fats class), egg, fresh milk, powdered milk, tin milk (under milk, cheese, and eggs class), soft drinks e.g. Malt Guinness, Coco-cola, etc, spirit (local production), Chelsea, Seaman Schnapps (under Spirit Class), Wine and Fruit e.g., Water Melon, Pineapple, Banana, Pawpaw, etc.

“The average annual rate of Food inflation for the twelve-month ending April 2024 over the previous twelve-month average was 32.74 per cent, which was a 9.52 per cent points increase from the average annual rate of change recorded in April 2023 (23.22 per cent) .”


Commenting on the issue, the National President of the All Farmers Association of Nigeria, Kabir Ibrahim, stated that Nigeria had never claimed to be entirely free from imports; rather, we have only achieved freedom from importing certain items.

He also projected that the figure would likely increase this year due to the continued dependence on food importation.

Kabir said, “If you look at the regime we came out of on the dependence of importation and the numbers before that 2023 figure. We spent more on food importation before 2015 but between 2016 and 2021, the figure dropped from our observations. However, it went up in 2022 and 2023 and I am fearful that the figure may be higher this year because you can see the challenges that we have been facing due to insecurity, flooding and other challenges of the purchasing power of farmers.

“Nigeria has never boasted of being free from import, we have only been free from import of some items. We tried to draw a line between things that had no sufficiency and those we had seen as insufficient. All the cries you see about food unavailability and not being affordable may even become more serious between July and September when we are in the thick part of the farming season and we would have finished harvest from the previous farming season and that is when things get very critical.”

On his part, the Managing Director, of the Centre for the Promotion of Private Enterprise, Professor Yusuf Muda, advocated for verifiable data to differentiate between total food consumption and the expenditure on food imports.

The economist stressed, “We need to know what kind of food is being imported. If they are talking about things like wheat, then that is justified because we make bread, flour, spaghetti and noodles from wheat. We also have to get the total amount of food consumed yearly. What percentage of it is imported and what is produced in the country? That data is needed to compare and make correct assumptions on it.”